entrepreneurship startup advice

Inside story on raising $24m funding, and working with VC’s

I believe this is the best post I’ve seen on startup funding since the creation of Venture Hacks:

Raising money for a startup is an inherently risky proposition. You step up to the plate knowing that the odds are slim and that, for every story of success on TechCrunch, there’s two hundred companies pounding the street, getting nowhere. We went the opposite route – letting investors come to us.

This is the story of that experience – being “pitched” by investors, the decision-making and negotiation processes and the end results.

Rand writes in detail the complete story of a major funding round for his startup, where other CEO’s are “too busy” or don’t have the balls to share publicly.

He talks about what happens when you “practice” things that leading-lights of the VC and Entrepreneur world have long been “preaching”.

He lays out a strategy popular with armchair entrepreneurs, and relates his experience of how it can go wrong.

This should be required reading for any serious Tech Entrepreneur / Startup team…

entrepreneurship startup advice

Great news: Cambridge (UK) startup sells for £7 billion

(that’s almost $12 billion)

This is a BIG DEAL, for the UK, and for Cambridge. Rory Cellan-Jones is moaning about how terrible it is (“looks like a sad day for British technology – and for Cambridge in particular”) – and I wanted to put across a very different perspective.

NB: this is just my personal view of how this affects small startups and entrepreneurs. I’m sure there’s much more detailed and smart analysis flying around the financial world, given how big the sums of money are here.

From ZDnet’s report:

“UK employees will get a total of £30m in share options. Founder and chief executive Mike Lynch will continue to lead Autonomy and, as the owner of 8.2 percent of the company’s shares, stands to make more than half a billion pounds off the deal.”

(incidentally – both Rory/BBC and ZDnet report that £0.5b is going to Mike, but I’ve heard that it’s shared between him and Richard Gaunt? Not sure which version is true)

Two things I want to point out here:

Cambridge finally sees multi-billion-dollar exit

10 years ago I was in Cambridge and helped start the £30k business competition. At the time, the dot-com boom was still in full swing, and there was a great deal of excitement. We spent a lot of time with investment funds, startups, and angels.

But there was also a sense of “we’ve been here before, will it go wrong again?”, coming from the older generation – the previous generations of entrepreneurs and investors. To be clear: none of them had become California-sized successes, although there were plenty of professional investors making an OK income from their startup investments.

The suggestion was that in the 1980’s/1990’s, Cambridge had got over-excited, convinced “whatever San Francisco / Palo Alto / Stanford can do … we can do too! (and probably do better)”. But the reality had been that Cambridge had a much smaller area, in a less homogeneous market (europe vs USA), with less investment and less tech resource.

A frequent question was: what would it take to achieve “critical mass” in Cambridge? One of the top answers was: “some billion-dollar startups”. Cambridge had plenty of startups that made tens of millions – but none going for 1,000 x millon dollars.

The forerunners were (off the top of my head): ARM, Autonomy, and Zeus. Zeus was the brand new startup out of nowhere – very much hoping for Cambridge to give them a Silicon-Valley style catapulting into the stratosphere. ARM and Autonomy were older, established tech companies that had shown they could reliably make huge sales internationally. Zeus spluttered out when the dot-com crash hit, but the other two have gone from strength to strength (ARM is currently worth £6 billion).

So, finally, we have proof: you can take a startup in Cambridge, and the founder(s) can grow it to a multi-billion success, and then *sell* – while still CEO – for billions of dollars. I’m slightly happier that it’s Autonomy doing this rather than ARM – ARM has been through many management teams over the years, but Mike Lynch has remained at the helm of Autonomy throughout. “Founding CEO still in charge until the big sale” is what new startups want to see when looking for local success stories and role-models.

Mike Lynch has £500 million burning a hole in his pocket

Why does the whole “billion dollar valuation” thing even matter? There were a bunch of reasons given – all based off analysis of “why didn’t Cambridge become a serious rival to Silicon Valley in the 1990’s?”:

  • Venture Capital firms won’t take a region “seriously” until it’s shown it can create companies of the *ideal* size that VC’s want. A VC may be happy with a $50 million exit – but what they really want is another Skype: multi-billion exits.
  • When startups sell for the tens of millions, the founders often don’t make a huge amount on the sale. They end up “rich”, but not rich enough to become “super angels” (bear in mind that an angel needs to write-off their investments – you need a lot of spare cash you’re willing to *burn*).
  • One step down: the early employees get enough money to perhaps pay off their mortgages – but not enough to become “angels”.
  • Arguably, there’s something self-limiting in the region – some blockage – if companies are stuttering before hitting the multi-billion mark. It’s not a problem in itself, but it’s a “warning sign” – and other industries and entrepreneurs will think twice about locating their new startups there.

With this Autonomy sale, we have £30 million spread across employees – should be enough to create a handful of new Angels. I’m assuming at least some of them will stay around in the Cambridge area.

Meanwhile … although I believe Mike’s been an Angel for a while already … he’ll now have more money than many VC funds. Interesting dynamic for any startups looking for the best of both worlds (VC and Angel)…

project management startup advice

What it looks like when a manager REALLY supports their team…

I’ve encountered many managers who are in love with the IDEA of supporting their team, but not the REALITY.

Typical examples:

  1. “My team are great. I push them hard and they deliver great stuff on time” (in reality: the team resents the bullying, self-aggrandizing jerk)
  2. “I’d do anything for my team. When they’re working til midnight for me, I stay late too – I even buy them pizzas!” (subtext: they’re worth $6.99 for 4 hours of overtime, and no sleep. Also: they should be grateful I even stayed around, playing minesweeper while they worked)
  3. “I like to think of myself as a sh*t-umbrella: I take the sh*t for my team from my boss” (easy to say when “sh*t” is nothing more than a few vague fears about quality; but what about when the REAL sh*t arrives; is that swishing sound you hear the sound of your manager covering their own ass? Or just of them throwing you into the path of danger, a human-shield to protect them?)

So, here’s a refreshing (if somewhat old) counter-example:

How Pixar Bosses Saved Their Employees from Layoffs

computer games games industry startup advice

Euclideon: $2m scam for fake games tech?

TL;DR – notch reckons “it’s a scam” (I wouldn’t go that far – “scam” is a strong word, I reckon they’re just too naive/ignorant/foolish/arrogant to realise what a huge mistake they’re making)

My gut feeling is: this would be a terrible investment. By comparison, the middleware companies that sell for tens of millions of dollars usually don’t seek this level of investment until AFTER they have many licenses / sales already. Euclideon seems to be asking for money BEFORE demonstrating that any games company can do anything useful with it.

In the games industry, we have a name for this particular kind of exuberant, short-sighted claim:

“Infinite Monkey Engine”

(apologies to Demis Hassabis, a nice guy who created the term “Infinite Polygon Engine” intending it to be genuine. It backfired horribly when it turned out to have little or no value in game terms; IIRC it only shipped in “Republic: The Revolution”?)

IMHO … The Euclideon folks have shown no signs (in public) of being aware of what a complete waste of time and money their technology “probably” is. They apparently haven’t (bothered to?) spoken to any games-industry companies – this should be an absolute requirement LONG before they raise funding above the $50,000 level.

Maybe they have; maybe their own PR is a big confidence-trick – they know how misleading/wrong their claims are, and they’re just trying to keep potential competitors fooled. If so, I’d say that’s a rather … short-sighted … strategy.

More likely: they’re full of their own inventiveness, and have nowhere near enough startup / business experience to have run the analysis on *why* this tech isn’t used *any more*.

(public signs so far suggest they’ve picked up an old tech, convinced themselves it’s new and novel, and don’t realise that it’s a dead-end that the industry has already rejected)

entrepreneurship startup advice

A startup success story: “what … wouldn’t make us cry anymore?”

All in the same market/need/desire space:

First product: FAIL.
Second product: FAIL.
Third product: looks set for success

“Our last version was just Tian and I late at 3am practically crying that everything in the food world we were building sucked. So we asked ourselves what could we do well that would be fun and wouldn’t make us cry anymore. And we came up with this. And this version makes us happy.”

Particularly interesting to read how radically different the three *products* were, even though they were fundamentally selling into the same “space”, and there was a lot of crossover in the underlying technology.

This is one of the hardest real, day-to-day (and month-to-month) problems that startups face. Every case is unique, and I’ve seen lots of smart people crumble at that point – or just go round and round in circles till they run out of money, or give up.

startup advice

Startup Weekend Amsterdam: Advice and insights

From the fascinating APPsterdam experiment / movement (“persuade a load of startups to move to Amsterdam for the Summer, instead of the more expensive California, and create an ad-hoc startup hotbed”) –

“You might think companies that have gone out of business are no threat to you, but if you’re trying to get funding, they are your biggest threat. The only thing worse than an unproven model is a disproven model. You need to know exactly why they failed, and prove that you are different.”

“When you’re pitching on stage, don’t bother giving a bio. You need that time to show off your products. Plan for failure. That means being ready to present without slides or notes. No live demos. especially ones that rely on WiFi. If this can trip up Steve Jobs, what chance do you have? Make a movie.”

entrepreneurship investors startup advice

“seasoned startup investors absolutely hate patents and the entire patent system. They compare it to a cancer in the economy. “

Yes! Yes, yes, YES!

Next time anyone in the UK hears an investor ask about patents (hint: they probably are ex-3i staff – and no, that isn’t a good thing), send them this:

10 Myths about patents

“Myth 3: Nobody would invest in startups that don’t have patents.

Fact: The seasoned startup investors absolutely hate patents and the entire patent system. They compare it to a cancer in the economy. ”

advocacy games industry recruiting startup advice

Rockstar’s LA Noire, McNamara, Team Bondi, Crunch, and Advocacy


A month ago, PC Gamer reported that “The idea that crunch wasn’t all that productive was raised, but there was enough experience in the room to shoot it down. “. I found that unacceptable, both as a concept, and as something for the media to report without challenging it.

Last week, it became public that LA Noire was built on the living corpses of hundreds of developers, approx 100 of whom have been stripped of their hard-earned professional Credits (take with a pinch of salt – but the allegations are compelling).

The guy in charge – right at the top, where the buck stops – went on record to document some of his abusive behaviour, and to argue that his behaviour was perfectly acceptable. He implied that anyone who refused to be abused by him was … unprofessional or naive.

(aside: never, ever, EVER work for Brendan McNamara. Read the IGN article to see why. If you wonder: “but maybe this is ‘normal’ for the games industry?”, here’s the answer: No, it absolutely is NOT normal, it is NOT acceptable, and I believe many professionals would agree it has reduced the quality of the game that was produced. LA Noire could have been a better, more profitable game)

IGDA – a 10,000-member organization for game developers – refused to censure this behaviour. Despite having an entire (mostly useless) committee devoted to “Quality of Life”.

(UPDATE: IGDA’s now responded properly: “Brian Robbins, chair of the IGDA Board of Directors, said the association would fully investigate the issue. … ‘reports of 12-hour a day, lengthy crunch time, if true, are absolutely unacceptable and harmful to the individuals involved, the final product, and the industry as a whole,’ Robbins told Develop.”. Yay!)

Erin Hoffman – famously EA_Spouse, who campaigned hard for fair treatment of employees back when her husband was a victim – could only say (according to the IGN article):

“Ultimately, all the developers can do is work their hardest to get hired at better companies. It is every developer’s responsibility to know their rights, and be willing to fight for them,”

i.e. there’s no help for you. Executives, Management, Industry Organizations – have zero responsibility. It’s the problem – and the fault? – of the lowest people on the foodchain.

(“basically, … you’re fucked”).

The biggest issue in the professional games industry today

A conversation I had recently, someone posed the reasonable-sounding idea:

“[you can] provide advocacy on the benefits of eliminating crunch, or information about the crunch and overtime pay policies of various companies, historical crunch duration on past projects, etc.

But at the end of the day it’s up to everyone to make their own individual, informed decisions about how they want to conduct their professional lives.

My response, which I feel is too important to keep private (bear in mind I’m quoting myself slightly out of context here)

Society is based on contract: we sacrifice some things, and we take on extra responsibilities, in return for the benefits and the assurances.

One of those responsibilities is to look after each other. This has nothing to do with “personal choice”. It’s to do with dragging everyone up to a high standard of living. Without it, society functions poorly, and ultimately fails. Once society fails, people who had a high standard of living suddenly lose everything: you can never sleep safe at night. Nothing you own is yours. Everything can be taken from you, and there is *no* comeback.

The “payment” part of the social contract isn’t optional. It’s a binary thing, you have to take the whole package, or none at all.

What is the IGDA doing about this? What is Erin doing? What are you doing?

There was another part of my answer, relating to the idea that people were disseminating knowledge, and that was enough:


[but…] They could also grow a pair and say: “crunch fucking sucks. The only people who don’t know this are the ones at the top of the food chain exploiting everyone else. *OF COURSE* it doesn’t suck when you’re not the person doing it.”

They could say: “if you’ve never crunched, and you’re about to join a company that does crunch, DON’T DO IT. Find somewhere else unless you really have no choice.”

They could say: “here’s a list of companies that have publically admitted (or been outed) as using crunch regularly (or even permanently), or as a project-management tool.”

See how fast companies change in the face of that.

But it doesn’t work, fighting the employers. They won’t change

Yes, it does work. You just need a big enough lever.

[UPDATE: there’s a lot more details now on’s bad website that requires login – use the email “” and password “fuckgi” if you want to read it. See what effect this has. Personally, I’ve now also added Vicky Lord to my list of “never work with this person ever”]

(an aside: is 10,000 members enough? Well, allegedly it was enough to scare one of the abusive employers – Mike Capps – into joining the IGDA board just to stop it from fighting for reforms that would have coerced him to change. There’s some reading between the lines there, but most of it comes from his own public statements)

Personally, I was treated extremely badly by one company (Codemasters). Weeks after hiring me, they fired me. They did it illegally, so it’s hard to be sure, but it seems I was intended as an object lesson to bully a large AAA team into bowing into submission. Perhaps: “we can fire him for no reason, we can fire the rest of you. STFU and work harder, SCUM!”.

Within weeks, something like 20 people had resigned from the team.

Within months, I was getting cold calls from people who’d told me they’d been offered good jobs at this company, but had turned them down *purely because of* hearing about what was done to me. I’d never heard of, spoken to, or met these people.

Within a few years, I was hearing stories of how the company had changed – had been forced to change – its practices.

In a way, all I did was what Erin describes: individuals fighting for themselves.

In practice, I had to lose my job to achieve it. As an individual developer, I was fucked. This is what’s wrong with Erin’s view of the world: it is NOT ENOUGH to tell everyone to sort their own problems, unaided. It’s our collective – and individual – responsibility to help each other.

entrepreneurship games industry investors startup advice

Notes of interest from NESTA games-funding event

This (“NESTA: Investing in Video Games”) was last month, but I’ve been too busy to write it up till now.

The most interesting things that I noticed at the event:

  • Index is interested in spending SEED money on games companies [Ben Holmes]
  • Index can now “write cheques” up to $1m in the UK “in 1.5 weeks”; typically they’re writing them for $200k-$500k – they’ve done 20 of those in past 18 months [Ben Holmes]
  • Tony Pearce won-over Turner as an investor by saying he’d be bringing them detailed analytics on the social gaming industry [Tony Pearce]
  • None of the panel mentioned VentureHacks, even when it was the obvious answer to some of the questions from the audience. I had to grab the microphone and do it myself.

I felt a bit mean, hijacking their Q&A session. But, really … startups *need to know* about VH. It’s wrong for investment/government events to ignore it, or pretend it doesn’t exist; in the long run, everyone benefits from the existence and spread of VentureHacks.

entrepreneurship games industry startup advice

UK games studios and basic business failures

Recently I had reason to contact a bunch of UK games studios. I thought the hard bit would be to find the names of all those out there. Actually, the hardest part was navigating their websites to do the outrageous thing of daring to send them an email…

Here’s a question for anyone lamenting the unlucky business lives of games companies: If your business cannot be easily contacted, how many opportunities do you miss before you even get a chance at them?

Plenty of failures, but some particularly amusing(ly bad) examples I’ve cherry-picked:


You can *phone* them on a pay-per-minute number (nice!), but you cannot email them. Brings new meaning to the phrase “(their) time is (your) money”.


The contact page shows up as the “games” page.

Wow. Great QA on your website there, guys. Did *no-one* check it before going live? Do you visit it yourselves?

(and the only things you’re allowed to talk about are jobs and PR. What does this tell you about their priorities, I wonder?)


You can download PHOTOS OF THEIR OFFICES 11!!!!!!1111 (featured not just once, but twice, on that page) … but you cannot speak to them.


Apparently, the only two possible reasons anyone would contact them is because there’s a bug in their games (support@), or they want a job (jobs@). Hmm. Again: does this reflect studio priorities?


No contact address, link, or form anywhere. Nice!


When you click the “contact” button, you get this monstrosity:


(hackers trying to cross-site-script attack your browser? Or just a deeply incompetent web-designer? I’ll let you decide…)

HINT to Full Fat: webmail. Yeah. Think about it. Over 1 billion people use webmail as their primary mail client these days. Hmm.


Their email is a Flash app.

A FLASH APP. To display 40 characters of text. Ya, Rlly.

Also: it doesn’t work. When you run it, it displays the text, but won’t allow you to copy it. Huh? I have to manually transcribe the letters. Why? Why, for the love of all that is good?

(and if your spam-protection is really so outdated (and FAIL: you really don’t understand where spam comes from, do you, guys?), then why didn’t you just put a static image in there instead?)

agile recruiting startup advice

“I have never regretted firing anybody. Not once.” – Mark Suster

One of those things that most business people don’t talk about unless prodded. I’m not sure why, but I assume it’s one aspect of the fear “don’t burn any bridges; don’t let anyone think you can be nasty; don’t let anyone see you’re human”. None of which are healthy, long-term ideals IMHO – although they may be a good idea for many people. (they’ll often keep you in a job you’re unsuited for for longer than you would survive without them).

“I have on many occasions regretted not firing somebody quickly enough.

I’ve made every excuse to myself in the past, “I can’t fire him now, he owns the customer relationships and it’s a crucial point in our sales process.” Or, “I haven’t given him a long-enough chance to prove himself – let me see how he develops” or even, “it will have a big impact on morale because she is well liked. I can’t afford that right now.””

Some other good points in the post from Mark, including his list of 3 key ideals in hiring. Although … I still don’t agree with his “if [you change jobs] 5-6 times there is probably a pattern that isn’t completely the fault of some asshole boss.”. Well, I agree with the deduction – I’m sure there is a pattern, something interesting causing these rapid job changes – but I don’t agree with his conclusion that this is a bad sign in a jobseeker / candidate *for a startup*. (for a corporate role, it’s a huge red flag; for a startup, it might even be a positive selector; IMHO it’s too complex an issue to make catch-all pronouncements like Mark’s)

(and c.f. my previous comments on hiring, e.g.:

“I’ve noticed practically no correlation between skilled people going on to fulfil greater potential – many did, but many got worse. I’d still hire very skilled people – you know they’re useful – but … and this is a reflection of my own interests … in a startup environment, I’d tend to look for the enthusiastic ones by preference.”

entrepreneurship startup advice

“startup fundraising isn’t about convincing skeptics but rather finding true believers”

(From an aside by one of LinkedIn’s founding team (interesting blog post on what it was like raising the first Series A funding for LI))

This is one of the hardest things for “old style” European VC firms and Angels to get their heads around, IME. And it’s entirely true, IMHO.

In general, if you find your startup is like swimming uphill against a stream – no matter that you’re succeeding – then it’s either a crummy startup hardly worth doing, or you’re going about it the wrong way. In most startups there are many occasions when it’s difficult or hard work – but in each case, the “working hard” part is optional: you could keep working at a normal pace and still succeed; you just choose to work harder in order to take your “success” and make it “a bigger success”. If you have to work hard just to avoid failure … forget it.

I suspect it’s the infamous protestant work ethic that (perhaps) leads vast swathes of UK and EU people to believe:

“if I work hard, and I suffer, I’m (deserve to) going to succeed; I should expect it to be hard, and cultivate difficulty; easy things are to be suspected and – ultimately – avoided”

IMHO, it’s more likely that a lazy person will find a great product/market/timing and be successful … than that a hard worker will take a weak product/market/timing and force it to succeed by working their ass off. A startup is a company; more than any individual – if the idea is great, other people will join, and tend to pull the work-output closer to the average.

Think on this:

if you’re a lazy founder, every person you hire is bringing the average up. If you’re a workaholic, every person you hire is bringing it down.

(Who am I kidding? If you’re a workaholic, you probably aren’t allowing anyone else in anyway – and don’t have time to interview them. You’re working harder and harder, somehow subconsciously convinced that “hard work” will inevitably create “success”)

entrepreneurship investors startup advice

Angel investor admits mistake; world doesn’t end

I don’t normally call-out individual investors, but this tweet from Max Niederhofer underlines something I’ve been thinking about for a while: I’d like to see a culture of equity investors admitting (publically) their missed investments as often as they big-up the ones they made.

Biggest angel investing screwup of mine of the last 18 months: not accepting @begemann’s offer of getting into @wooga. 18M monthly players!

And of course – aside from the investor issue – it’s interesting just how big Wooga is right now.

Anyway, I’d like to celebrate Max (and others) for publically admitting he misjudged that investment. I wish more investors would do this, on a regular basis.

Why should an investor keep quiet?

I make no claim to know the mind of investors. The nearest I can come is that – for a while – I sat on an investment team that made recommendations on investments from $0.5m up to $10m. I loved the experience of being on “the other side” of the table. But I only did it for a year or so – I’m in unfamiliar territory here.

Some guesses / intuitions from that experience (and from conversations I’ve had with investors over the years):

  1. The suspicion that you might scare-off new startups when they hear you rejected other startups that they consider similar to themselves. Fair enough – although I think this does a disservice to entrepreneurs; we’re not stupid – we know that investors make mistakes, and we expect them to learn from them, I think many of us would be more eager rather than less (“they’re probably smarting from that mistake, and more likely to jump on a similar opportunity like US!”)
  2. Funds, especially, sell themselves on their reputation for making “the right” decisions. Every few years, they have to persuade a bunch of very rich individuals to part with tens of millions of dollars, on nothing more than the faith that the fund will invest it more intelligently than the investor would have themself. They don’t want to tarnish their reputation by admitting the profits they “failed” to secure for their own investors.
  3. Angels have a similar reputation issue, but with Funds, rather than with investors. My impression is that this relationship is a lot less fragile / critical – but if an Angel is respected by a Fund as a canny selector of good startups, it could make it much easier for said Angel to cash-out when they need to. Although… that exit may itself make the Angel look bad (why are they getting out? What gives?) so I’m not sure this is so important
  4. Pride. Both personal and professional.
  5. Fear of revealing their personal “investment strategy” to their rival investors. I’ve heard Angels talk about how they have a secret sauce in their choice of investments – one they guard as vigorously as Coca Cola’s – but I’m not sure how important this really is. “Security by obscurity”, and all that…
  6. Um. Others?

Why should an investor confess?

As an entrepreneur, when I’m sifting through potential investors, I’d like to know:

  1. Does this guy track their failures as well as success – do they live by the same rules they expect us to, i.e. “test and prove and IMprove”, or are they stewing in a soup of arrogance and ignorance?
    1. An investor that gets better each year is one I want on my board – chances are, their advice and input will be better year on year. Not stagnant.
  2. Market opinion: what other entrepreneurs came to you with serious investment offers? Social proof works both ways, guys…
    1. Every investor will boast about the good investments they made, but that tends to be a small pot. Sure, they see 20 (or 200) pitches a year – but how many of those pitches are from smart entrepreneurs? Do the smart guys avoid this investor, or do they swarm to them?
  3. Market exposure: what has motivated them in the past to make yes/no decisions? Not theoretical (fakeable) ideals – but actual deals they’ve rejected. (again, finding out the deals they accepted is relatively easy / common)
    1. Does this investor get enough exposure to the “real” spectrum of startup opportunities? Or do they only deal with – say – Financial Services tech startups? Will I end up having to (re-)educate them on the realities of (say) Social Media startups, because although they’ve funded one … that’s the only one they’ve ever seen (and they judge everything else by that one)?
  4. Honesty. With personal recognition of past mistakes, and the dose of humility that required.
    1. Yeah. Most people don’t care about this one. I do. If I’m holding myself and my colleagues to these standards (and I do) … why should investors get a bye?
conferences entrepreneurship games design iphone programming startup advice

I’ve got an idea; I’ll give you 25%…

…if you:

  1. finish it
  2. and design it
  3. and build it
  4. and test it
  5. and refine it
  6. and launch it
  7. and sell it
  8. and market it

…for me.

This was the tempting offer whispered in my ear this evening by a hard-up web-developer at a networking event, once we were alone, and he’d heard I developed iPhone apps.

For the record, this is the worst offer I’ve ever had – even in the days of the iPhone goldrush (2008, mid 2009) the least I was offered was “one third”. Since then, even the unrealistic offers usually start at $2,000 cash up-front.

I smiled, and said nothing.

I carried on the conversation, when he suddenly broke into a long (minutes) tirade of abuse in the middle of the venue, because I’d “blown [him] off” when he’d “offered to share [his] great idea”.

I stood there in silence for another 30 seconds, wondering what to do: should I respond in kind? should I try to help him? should I walk away?

I decided to try and help him. I asked him to think about how his offer sounded to someone who makes apps for clients every day. (he ranted about how I thought I “was the Big Man – BUT YOU’RE NOT!”). I apologized profusely for offending him, and said I’d try to explain (he told me to “scuttle off, little man”). I made one more attempt – I pointed out that after inadvertently offending him, I was at least trying to make amends, and all he seemed to want to do was insult me. He sneered.

So, my public-service act for the day:

How much does it cost to develop an iPhone application? (tl;dr – $250,000 for a good one)

(note: when we talk to clients, I advise them the sane limit is c. $150k for a great one, or $75k for a good one. The $250k figure is accurate if you’re doing own-IP and it HAS to be awesome (like twitterific, quoted) – but you always end up spending more when it’s your own IP – or if you work with extremely expensive digital agencies who don’t have in-house iPhone specialists. Most of the good, solid iPhone dev teams are about half that price)

NB: this problem (“I’ve got an idea, I’ll let you have it in return for a profit share”) is prevalent among people who know nothing about computer games, as much as for people who know nothing about generic iPhone apps (but who read the papers and think they’re sitting on a goldmine. That’s very interesting in and of itself…

At the end of the day, I walked away from Mr. Abusive. Some people just don’t want to be helped, sadly…

games industry games publishing marketing and PR startup advice

Social Games are “evil” (a.k.a: Indie Marketing 301)

I reckon this is just a case of indie developers (finally) starting to
understand the concept of “marketing” in a bit more depth than the 101

With my PR hat on, this is great stuff: highly contentious (and
potentially dangerous) quotes – and yet, nowhere near as
career-damaging as declaring that a certain console is ****.

“Evil” is emotive, but just vague enough that you can get away with it in ways
that you can’t when you target billion-dollar brands. *ahem*.

I’d also add that – in true marketing style – this whole conversation
is about 6 months behind the curve. Which is about right for a
mass-market promotional piece – people at the coal face have moved on,
but Joe Public is still intrigued and yet to catch-up. Anyone who
still thinks Zynga is the company from “that SF Weekly article” is
living in dreamland. FB games moves much, much faster than that.

community marketing and PR mmo signup processes startup advice web 2.0

Skype: failing at customer support at scale

I had a serious customer-support problem with Skype recently, relating to money they’ve taken from me. It’s proved excessively difficult to get a response from them – surprising, considering their size, their brand, and the fact it’s a paid-for service. It raises some interesting questions over Customer Support / Community Support, and how they can/should be scaled.

FYI, the initial complaint is over what looks like a scam – if you pay for Skype, but don’t use it frequently enough, they cancel the service but keep the money. It was probably buried somewhere in the smallprint, but I certainly don’t remember that as part of what I signed-up for: “pay now … get screwed later!”. Whether or not it’s legal, it’s certainly dishonest (they give no explanation, it’s NOT part of the marketing materials, it’s just “policy”). It feels like theft.

Their website was useless. So, I asked them about it…or, at least, I tried to.

  1. Reply-to-email: I replied to the email they sent me where they said they’ll be taking my money but NOT providing the service. They sent it from “”; this is a fundamental abuse of the email system, a sign of amateurish support teams. FAIL
  2. Email-to-support: I tried forwarding that + my question to the standard email address – I’ve been using Skype for 5 years, and I thought this address existed. Eithet my memory is wrong, or they’ve deleted it since. It doesn’t exist at the moment – you get a mailserver error. FAIL
  3. Google for “email support skype”: I tried again, emailing the support address that Skype’s own employees have sent emails from – right now, on, you can see example emails sent from “” (maybe this was what I remembered from years ago?). But if you send an email to that address, you get an email back saying: “Thank you for your email. Unfortunately this email address is no longer in use.”. FAIL

500 million accounts … too many?

Skype’s customer-support is unusually weak here; this is a paid-for product, and they’re actively blocking people from getting support. That’s not how support works; that’s what you do when you don’t have a support team – usually because you’re too poor to afford it AND you have no paying customers. Doing this with paying customers is surprising. Especially for a large product/brand.

I remember in the very early days of Skype they already had 50-100 employees for what was a comparitively small operation. IIRC, a big chunk of that was dedicated to support, and a big chunk to marketing – only a very small part was tech. I’d assumed that with their 10’s of millions of users, they had a highly automated customer-support system.

Today, they have well over half a billion user accounts – and it would seem that even their automated systems have failed. Why else would they put a block on industry-standard email aliases? And deliberately shutdown their own support address?

Obviously, those addresses would be flooded with spam and FAQ emails … but *all* commercial customer-support systems are specifically designed to handle those probems – and at large scale, too.

My guess is simply that whichever commercial system they use wasn’t architected to a high enough quality, and is incapable of handling Skype’s uniquely large customer base. This isn’t a criticism of that system – there are very few companies in the world with so many users of a single product. i.e. there’s very little demand for a product to be so carefully engineered.

But it begs the question: why hasn’t Skype put something better in place? Surely they have the resource and the skill to source or architect something better? Or is it a company policy to provide second-rate, low-quality support – even for their paid customers?

What Would Facebook Do?

…hopefully, I’ll post on this in more detail later, but briefly: they *eventually* went to specialist external vendors to provide the scalability they needed:

  1. Facebook was incapable of reliably delivering messages to users for most of the past 3+ years
  2. I’ve run several groups large and small, and found that approx 30% of all messages DIRECT to *opt-in* users went undelivered in the FB messaging system
  3. (speaking to other people who ran facebook groups, or had huge numbers of Friends, the experience was commonly repeated. e.g. I know a few people who had to setup multiple FB accounts because they had “too many friends” to fit on a single account)
  4. Facebook recently (last 6 months) replaced their internal, proprietary messaging with an external, specialist system from a company that specialises in high-volume messaging (according to the vendor; caveat emptor)
  5. Reports from other people who still use Facebook for large groups / large numbers of friends suggest the “lost in the post” phenomenon is now cured

Incidentally, I don’t/didn’t think much of Facebook’s tech team (although quite possiby it’s improvements in that team that have lead to fixed like the one above). It’s very hard to be sure, going on just public info, but I used to read their blog, and their posts about performance and architecture were for a long period … amateurish.

On some core subjects, they betrayed a deep lack of experience and understanding – and apparently no effort being taken to correct that, but rather they preferred to “hack” away with band-aid solutions. Great fun for them, but not appropriate for a billion-dollar service, IMHO.

server admin startup advice Web 0.1

Don’t use BitBucket – broken OpenID authentication

We’re starting a new client project, and the client uses Mercurial exclusively, all through BitBucket.

BitBucket has a stupid user-accounts system, that demands you invent a globally-unique username. Oh dear lord – how amateurish are you guys?

Aha! BUT! … they have a (very subtle) link to let you use OpenID instead. Phew! My day is saved – I don’t have to be “dodgy-69-sucker-11111” just in a desperate attempt to work around a naive website architect.


Except … once you’ve sacrificed your private account details to Atlassian, they … don’t allow you to login. It reports “success” but tells you that you’re not allowed to use OpenID to access the site, you STILL have to create a non-OpenID account, using a globally unique ID.

I’m sure they’re doing “something” with OpenID, but I get the impression that the folks at BitBucket don’t grok what most of the world is using it for…

How do I take back my Identity, you fraudsters?

Well, Atlassian won’t help you there.

Fortunately, Google did…

Google’s UI designers FTW

I used Google as my OpenID source this time around. And, *fortunately*, Google’s process for de-authorizing a website is very simple.

I usually assume Google’s UI is great, and I usually only blog about it when it fails badly, but here’s an example where it works beautifully.

(hint: there’s a shortcut – but Google might change the link in future. You can go directly to:

Just go to your account page (, and *right at the top of the page* (thanks, Google!) is a link to all your authorized websites – it’s in a big white space on it’s own, VERY easy to find.

entrepreneurship recruiting startup advice

Hiring people smarter than you

Startup CEOs are often advised to do this, but few people explain how the heck to do that, and its far easier said than done.

Ben’s got a great approach: actually do each of the jobs yourself, for real, before hiring people into them.

This resonates with my own experience, where “deliberate self obsolescence” has proved the most effective strategy for hiring senior management. Do everything yourself, and keep trying to make yourself redundant, by finding the most time-consuming thing you’re currently doing, and hiring someone else to do it.

This approach also neatly solves the eternal problem of “which role do we hire next?” – in a *prioritasable* fashion (which is important if you believe in scrum/agile/lean measurement, and can’t accept the answer “all of them!”).

PS a lovely quote in the linked post:

“The more experience you have, the more you realize that there is something seriously wrong with every employee in your company (including you).”


Personally, I finally escaped from this trap only when I started hiring on “enthusiasm” rather than on “skill”. So far, it’s not lead me astray…

amusing startup advice web 2.0

LinkedIn more popular than Twitter (according to LinkedIn?)

When I log into LinkedIn, I now receive 3 pages of spam. That spam is “every tweet by every person I’ve ever met”.

Somewhere, buried inside the avalanche of spam, are a few genuine LinkedIn messages. e.g. today I saw that a friend had moved to a new company – important, useful information.

Support: why would you want to refuse our spam?

I asked the LinkedIn customer support folks how to disable the spam. Their response:

You can “only hide the member’s Twitter updates [if you] also [hide all] their LinkedIn updates”.

i.e. your choices are:

  1. Get spam
  2. Get nothing

Hmm. Think about the people with tens of thousands of connections on linkedin. Their linkedin home pages must be absurdly high spam-to-signal ratio.

LinkedIn’s management: Twitter? WTF is Twitter?

LinkedIn’s CTO / lead architect / whoever authorized this stupid setup apparently “forgot” that the main feature of Twitter is it *allows* you to choose the people you receive tweets from.

(or, more likely, they’ve never used Twitter – it’s just a buzzword they’d heard of from a VC)

LinkedIn removes that choice. It simply forces everything on you. No filtering. No choices. Nothing. As a user, you exist to be spammed.

As a user, you exist to consume LinkedIn’s adverts, and nothing else. The site is – it would seem – not intended to be useful.


For a business to sink to such a low level of utility, and for the management to achieve such a high level of ignorance about the market, suggests to me that LI is moving rapidly towards implosion. I don’t believe it will still be with us two years from now. And that’s rather tragic, given how valuable it used to be.

marketing social networking startup advice

Startups: measure your attention-marketing (download)

If you’ve followed this blog for a while, you’ll have read my thoughts on the Science part of Marketing, and how much money this makes you.

As I explained recently to an Accountant, we don’t have a “business plan” for my current company, we only have a spreadsheet. A spreadsheet – done correctly – *is* a business plan, and a better plan than any you’ll ever see written down.

(NB: I’m not an accountant. I’m not a Finance Director – and never have been. I don’t even like spreadsheets; normally they bore me to death. But this is an exception. It is the only way to effectively plan and run a startup)

So I was delighted to see that Dave Stone has posted a spreadsheet to track and measure the effectiveness of your “attention” campaign – how much exposure did you get from TechCrunch et al? Was it worth it?